Selling a business is a complex process that can take from 6 -18 months. Most business owners sell a business only once or maybe twice in a lifetime. The value of the business often comprises 65-90% of a business owner’s personal net worth. So, selling a business is a Really Big Deal for most owners, and while there are many things that go into a successful transaction, there are just as many things that can derail the deal. Avoiding these common mistakes is vital. 1. Not preparing sufficiently for selling prior to going to market. Many business owners do not [...]

Things may not be looking good for entrepreneurs in America, according to this article, The Mysterious Death of American Entrepreneurship. Well, things may not be looking good for entrepreneurs outside of the tech sector, that is. I'm working with entrepreneurs every day, so I see lots of stories of success and plenty of stories of struggle. But I think the American entrepreneur is still alive and kicking. An owner of a successful manufacturing company contacted me recently, wanting to find a way restructure the ownership in his company in order to allow his older brother to retire with financial independence. [...]

It has been said that necessity is the mother of invention. In this Wall Street Journal article, Big Firms Fill Funding Gap, the author shares how big firms still need their smaller suppliers and vendors. So much so in fact, that some large firms are stepping up and providing working capital and bridge loans to help their smaller counterparts grow and become well-established companies. For entrepreneurs and owners of smaller firms, having just a few large customers, i.e. customer concentration, greatly increases overall risk in the ownership and operation of the business and can become a real value detractor when it [...]

In my business I have the privilege of working with many remarkable leaders and entrepreneurs and I have to agree with this article: being resourceful goes a long way towards success. Finding ways to make something out of nothing, setting up your office wherever you can use your laptop, taking the risk of killing good ideas for better ideas - resourceful people figure out how to make it happen. Are you scrappy, inventive or enterprising? Check yourself against this list from Inc. Magazine: 7 Things Really Resourceful People Do

How Wealth Planners can help their clients and increase their assets under management. Right now, today, as you read this article you could be sitting on acres of diamonds … in the rough. What do they look like? They are your business owner clients who over the last 15, 20 or maybe 30 years have focused their life’s efforts on building a successful small business and are now ready to move on to the next chapter of their lives. Are you positioned to help them make that transition? Current estimates suggest 10,000 baby boomers are retiring every day, and [...]

Understanding business valuation continues to be a challenge for business owners today, as discussed in this article from Inc. Magazine that I contributed to a few years ago. Thanks to Warren Meyer's Coyote Blog for the link.

EBITDA is Good, But Cash Flow is King At a recent M&A Source Conference, this was a recurring comment from Private Equity participants: “EBITDA is good BUT we need to understand the Cash Flow of any business we look at buying." Many business owners, their advisors, and even intermediaries, often mistake EBITDA for Cash Flow. EBITDA is defined as Earnings before Interest, Taxes, Depreciation and Amortization. It is easily calculated by taking normalized operating income and adding back interest, depreciation and amortization expenses. It is better to think of EBITDA as an indication of profitability and only a “proxy” for [...]

Walt Lipski owns and operates this website, and provides non-securities related investment banking services through Upton Financial Group LLC, primarily to companies with annual revenues between $5 and $75 million. Any testimonials presented herein are not intended to represent the experience of all clients or guarantee future performance or success. Real Estate transactions completed through Upton Advisors, LLC. Hyperlinks on this website are provided as a convenience and we disclaim any responsibility for information, services or products found on websites linked hereto.